Chesapeake executive compensation under review -filing

Wednesday, 3 Oct 2012 | 5:06 PM ET

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HOUSTON, Oct 3 (Reuters) - Chesapeake Energy Corp extended employment contracts with certain executives through the end of the year as its board of directors reviews the oil and gas company's compensation practices, according to a regulatory filing on Wednesday.

Two of Chesapeake's largest shareholders, Carl Icahn and Mason Hawkins, hand-picked four directors and a new independent chairman in June following a series of Reuters investigations detailing potential conflicts of interest by Chief Executive Officer Aubrey McClendon.

The filing provides a first hint that the so-far silent nine-member board under independent chairman Archie Dunham are taking action.

The directors, who are probing McClendon's potential conflicts, are also charged with shoring up the finances of Chesapeake. The Oklahoma City, Oklahoma company has been selling assets and plans to reduce spending next year to help plug cash-flow deficits in 2012 and 2013.

The employment contracts of Chesapeake's senior vice presidents and executive vice presidents now expire at the end of December, giving the board three additional months to make any changes, according to the filing with the U.S. Securities and Exchange.

A spokesman for Chesapeake was not immediately available for comment on the extension.